Case Study On Financial Difficulties Of *ST Xinwei

With the increasing internationalization of business operations and the intensification of fierce competition in the industry,the challenges faced by enterprises have become greater and greater,and various types of crises have arisen externally and internally.As a result,corporate financial risks have continued to expand and ultimately manifest themselves as financial distress.If all enterprises fail to respond positively,they will plunge the company into a financial crisis and may eventually go bankrupt.When studying the financial distress of enterprises,we can see the specific problems of distressed companies,and put forward relevant suggestions to play an important role in helping distressed companies to get out of trouble and to learn from related companies.The Xinwei Group studied in this article has been representative in the communications industry,and its main overseas business has brought the group a market value of 200 billion,which is highly evaluated in the industry.However,due to a news report in 2016,people began to pay attention to the crisis facing Xinwei Group.The group's performance fell for a while and its financial situation continued to deteriorate.In 2019,the Xinwei Group was issued a delisting risk warning by the Securities and Futures Commission for the two consecutive years of negative profit,referred to as * ST Xinwei.The article analyzes the financial distress of Xinwei Group from four chapters.The first chapter writes the research background and significance of Xinwei Group,the research method and content of this article,and the theoretical basis and literature review.The second chapter mainly introduces the situation of Xinwei Group.The first introduces the general situation of Xinwei Group,including industry,group profile,and group operating status.The second is to conduct a detailed analysis of the financial situation of Xinwei Group from the five aspects of debt repayment ability,profitability,operating ability,growth situation and cash flow situation,mainly adopting financial indicators.The third describes the specific performance of the group's financial distress,including loss of profits,insufficient working capital,high debt pressure,and being issued an audit report with non-standard opinions.The third chapter analyzes the specific reasons for the financial distress caused by the group.This article not only analyzes the external factors of the external economic policy and industry environment,but also analyzes the causes of Xinwei's financial distress,such as incomplete capital,from the deeper problems within the group.Specific factors such as structure,inadequate internal control.The fourth chapter of this paper proposes a series of countermeasures for each of the reasons analyzed.The first is to strengthen the optimization of the capital structure,not only to optimize the financing channels of the group,but also to continuously improve the debt structure.An enterprise's advanced budget management system must pay more attention to group cash management.The third is to improve the internal control mechanism and focus on establishing a group financial distress early warning mechanism,such as the Z-value model in the article.The fourth is to plan a reasonable corporate strategy,requiring managers not only to focus on short-term development,but also to formulate a long-term development strategy with a long-term perspective.The above suggestions are for the reference of the group and other financially troubled companies.It is hoped that through these suggestions,troubled companies can get out of the crisis as soon as possible and make greater contributions to economic development.The innovation of this article is based on the results of previous studies,and specifically analyzes a financially distressed company in the communications industry.The selected company is representative in the industry.The "buyer's credit" model for overseas business is also a large The business methods adopted by enterprises in foreign markets.This article studies the multi-level causes of its financial distress from the perspective of the external environment and Xinwei Group's own problems,and gives suggestions for using the Z-value model for financial distress early warning and budget Detailed countermeasures formulated by the mechanism for the reference of the group itself and other enterprises.